News and Insights


18 Dec

The State of Retail: How to Embrace Tech and Buck the Store Closures Trend

generic going out of business signs

Author: Alex Musto

Latest figures reveal that 9,271 US  stores have closed since the start of 2019. Only 4,341 have opened. 

Figures that compare starkly to the 5,854 stores which shut down in 2018. 

But while major names like Forever 21, Walgreens and GameStop struggle to survive in American towns and cities, overall retail sales show no signs of dipping. 

Indeed, Thanksgiving 2019 broke all online records with $4.2 billion spent by bargain-hungry consumers. Black Friday also hit a new high of $7.4 billion, up $1.1 billion on 2018.


While shoppers splashed the cash on their smartphones and tablets, bricks and mortar sales fell by 6.2% compared to the same day in 2018. The media tells us this is a retail apocalypse.

So how can familiar retail players increase their share of this enormous consumer pie?

If they don’t want to head the same way as neighbors such as Payless, Gymboree and Charlotte Russe, they need to rise against the negative rhetoric.

To do this they must understand that against this background of strong growth and spending, retail is undergoing two significant shifts: technological advances and evolving consumer behavior.

Here we explore why retailers who choose to ignore this evolution run a serious risk of getting left behind. A decision that could see them feature in the 2020 store closure list. And who knows how long that could be?

Understanding the Retail Landscape

It’s a jungle out there. The competition is fierce. Consumers are on the hunt for low prices, high quality and maximum convenience.

To keep turning even a modest profit, you need to keep your wits about you and even be prepared for a fight.

Your role in the retail food chain is to show off to the world exactly what makes you unique. Your brand must offer speed, convenience, an enhanced experience and the infrastructure to get everything from stock levels to slick payment that’s right first time.

Understanding these pressures and overcoming the challenges to deliver them could well mean adapting your business model. 

This means staying up to date with the latest tech advancements and strategies to streamline everything from keeping shelves filled to inspiring staff to stay loyal and encouraging customers to keep returning.

Online Versus Offline

Retailers across the country know they need to compete with the allure of online shopping. Whether relaxing at home browsing for deals or making a one-click order on the go, consumers value the convenience, speed and affordability.

This appeal is reflected in the stats. Ecommerce sales grew 300% between 2000 ad 2018 and now accounts for more than half of all retail sales growth. And the value of these sales rose to $517 billion in 2018, a 15% increase on 2017 compared to just 3.7% for bricks and mortar stores.

woman with manicured hand ready to tap an her tablet. Buying pink high heel slingback online with a mini tablet. The website is fictional, shoes photographed by Peter Hermus

But it’s worth noting that at the end of 2018 online sales accounted for just 14.3% of overall retail spend. 

Although this share has more than doubled in ten years, online growth is increasing at a steady enough pace to give physical stores  time to play catch up.

The gap between online and offline can be bridged by savvy retailers who understand the landscape and can meet customer demands and employee expectations. But they need to act now.

Deliver A Tech-Fuelled Experience

Expectations around customer experience have never been higher. 80% say the experience a retailer provides is as important as its products. And 67% say they would pay more for those products in return for a dazzling experience.

But despite this clamor, only 49% say they’re receiving that great customer service. 

Brands can no longer afford to compete on price alone. Experience is increasingly becoming a competitive differentiator. 

When shoppers just want to make a simple purchase, they can do that online. Physical stores now need to offer more. Something to persuade people to get in their cars, find a place to park and spare the time in their busy schedules.

There’s no room – or time – for complacency.

Take a look at how Nike are rising to the challenge in New York. Their six-storey, 68,000 sq ft store is based around the belief that consumers still want to visit a store, touch the products and interact with human beings.

Described as a ‘living breathing store’, it invites shoppers to design their own sneakers using embroidery and lasering, scan codes on mannequins and have items brought direct to the fitting room, and, of course, pay for their purchases on the Nike app. 

Pop-up shops are further ramping up the experience. Short-term stores aimed at whipping up hype and then disappearing to make way for the next one, they offer a unique way to spend some time and some money.

Online subscription box and pet gift store BarkShop set up their pop-up shop in Manhattan. Four-legged visitors were fitted with tech-equipped vests that tracked their movement. An app detected which toys they were most interested in, giving them valuable data and owners a sense of making the best choice for their pooch.

In this case, a tech-enabled pop-up created a unique experience for humans and dogs alike, plus it gave the company insight into product preferences and potential locations for bricks and mortar stores.

This level of engagement doesn’t need to mean flashing lights and bells and whistles like hologram store assistants. The foundations for providing an optimum in-store experience for these omnichannel consumers center on having the right tech to do the basics better:

  • Tailormade supply chain solutions that mean the item customers want will be in stock or can be delivered swiftly
  • Fully integrated POS systems operated by engaged staff that don’t just process their transaction but offer a comprehensive point of service
  • AI-powered software to crunch the data, provide in-depth analysis and inform the decision-making that augments the final experience

Equip Your Staff with The Tech They Demand

Central to delivering an exceptional experience are your store teams. Digital transformation is as much about people as it is about software and gadgets.

It’s about customers walking through your doors and being served by someone who’s engaged, has great product knowledge and can deliver the type of personal customer service everyone wants and increasingly expects.

And it’s about well-equipped employees who expect the same level of tech at work as they have at home. Tech that gives them unprecedented access to product knowledge and stock levels and gives them control over when and how they work.

From uniquely designed workforce management systems that support work/life balance to communication platforms that foster a sense of community, and information-packed tablets to respond instantly to customer requests on the shop floor, tech can both empower and motivate.

And it comes with a major business bonus: data. Lots of it. Data that can be analyzed by AI-powered software to drive efficiency, productivity and profit.

As Mike Callender, executive chairman at global retail technology consultants REPL, says: “Bricks and mortar shops can collect just as much data as online operators. The problem is, they’re not analyzing this data or using it to improve. If these retailers begin to use the tools at their disposal and learn from their online counterparts, they could start to buck the trend of store closures.”

For those retailers worried about being part of next year’s store closure statistics, harnessing technology and the insightful data it provides can significantly overhaul their operations and chances of survival.

Ready to revolutionize your workforce? Contact REPL, the retail transformation experts.

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